Disposition Choices Based on Energy Footprints instead of Recovery Quota

This paper addresses the impact of disposition choices on the energy use of closed-loop supply chains. In a life cycle perspective, energy used in the forward chain which is locked up in the product is recaptured in recovery. High quality recovery replaces virgin production and thereby saves energy. This so called substitution effect is often ignored. Governments worldwide implement Extended Producer Responsibility (EPR). Policies are based on recovery quota and not effective from an energy point of view. This in turn leads to unnecessary emissions of amongst others CO2. This research evaluates current EPR policies and presents six policy alternatives from an energy standpoint. The Pareto-frontier model used is generic and can be applied to other closed loops supply chains under EPR, exploiting the substitution effect. The measures modeled are applied to five WEEE cases. We discuss results, pros an cons of various alternatives and complementary measures that might be taken.extended producer responsibility;disposition;energy perspective;substitution effect;government policies;Pareto efficiency

Overview and classification of coordination contracts within forward and reverse supply chains

Among coordination mechanisms, contracts are valuable tools used in both theory and practice to coordinate various supply chains. The focus of this paper is to present an overview of contracts and a classification of coordination contracts and contracting literature in the form of classification schemes. The two criteria used for contract classification, as resulted from contracting literature, are transfer payment contractual incentives and inventory risk sharing. The overview classification of the existing literature has as criteria the level of detail used in designing the coordination models with applicability on the forward and reverse supply chains.Coordination contracts; forward supply chain; reverse supply chain

Simple heuristics for push and pull remanufacturing policies

Inventory policies for joint remanufacturing and manufacturing have recently received much attention. Most efforts, though, were related to (optimal) policy structures and numerical optimization, rather than closed form expressions for calculating near optimal policy parameters. The focus of this paper is on the latter. We analyze an inventory system with unit product returns and demands where remanufacturing is the cheaper alternative for manufacturing. Manufacturing is also needed, however, since there are less returns than demands. The cost structure consists of setup costs, holding costs, and backorder costs. Manufacturing and remanufacturing orders have non-zero lead times. To control the system we use certain extensions of the familiar (s,Q) policy, called push and pull remanufacturing policies. For all policies we present simple, closed form formulae for approximating the optimal policy parameters under a cost minimization objective. In an extensive numerical study we show that the proposed formulae lead to near-optimal policy parameters.inventory control;remanufacturing;heuristics

An integrated decision support framework for remanufacturing in the automotive industry

In today\u27s global economy, firms are seeking any and every opportunity to differentiate from competitors by reducing supply chain costs and adding value to end customers. One increasingly popular option, under growing consumer awareness and increasing legislation, is to reintegrate returned products into the supply chain to achieve economic benefits as well as improve sustainability. An important class of such reverse goods flows has to do with remanufacturing (reman), which refers to activities that restore returned products ( cores ) or their major modules to operational condition for using in place of new product or distributing through other channels (e.g., spare parts). While opportunities abound, some key complications reported in the literature include: 1) difficulty in timing the launch of reman product (while accounting for uncertainties associated with product life-cycle demand and core supply), 2) difficulty with capacity planning for remanufacturing (while accounting for the fact that volumes can be low and that facilities/lines should target multiple product families for economies of scale), and 3) operational difficulties in maintaining efficiencies in production planning and control of remanufacturing activities. These difficulties are mostly attributable to limited visibility and higher levels of uncertainty in reverse logistics (in comparison with forward logistics). Despite advances in the remanufacturing literature in the last two decades (both in the academic literature and practitioner community), there is no integrated decision support framework that can guide companies to successful launch and execution of remanufacturing operations. This is particularly true for companies that engage in both original equipment (OE) service as well as the independent after-market (IAM) in the automotive industry. This research aims to address these limitations by developing a decision support framework and necessary models for effective remanufacturing in the automotive industry. At the strategic level, we propose a unified approach to explicitly model and address issues of capacities as well timing the launch of remanufacturing programs for new product. We derive the optimal remanufacturing policy and extensively studied the drivers of cost-effective remanufacturing program for aftermarket services. Our policies exploit the ability to leverage OE production to support both the OE service operations as well as demand from the IAM. To the best of our knowledge, this research is the first attempt of its kind in the remanufacturing literature, as prior research treated these interrelated decisions separately. Valuable managerial insights are obtained by minimizing the discounted cash outflows caused by appropriate investment and core return inventory building decisions. We show that, under certain conditions, it may be optimal to delay the launch of the remanufacturing program to build up an adequate initial core return inventory. This may help in perfectly substituting virgin parts with remanufactured parts after end of the OE production run. At operational level, efficient production planning and control of reman parts for the supplier heavily impinges on the ability to accurately forecast core returns from customers (e.g., dealers, distributors). There are several challenges to this, including, the volume and diversity of customers served by the supplier, differences among individual customer warehouses in returning cores, large reman product catalogs, changing customer behaviors (often improving core return delays), and data sparsity. In this research we report the evidence for the effectiveness of hazard rate regression models to estimate core return delays in the context of remanufacturing. We investigate a number of hazard rate modelling techniques (e.g., parametric, semi-parametric etc.) using real-world datasets from a leading Tier-1 automotive supplier. Results indicate the effectiveness of the proposed framework in terms of stability and face validity of the estimates and in predictive accuracy

On how the acquisition of recoverable parts influences the profitability of spare parts management for durables

In the management of spare parts for durables OEMs often face a sharp decline in sales of spare parts when the warranty period of their products ends. One reason for this effect is given by the high profitability of the after sales market which attracts competitors. If the competitors’ main sourcing option consists of repairing used or broken parts, an acquisition of those parts by the OEM might lower competition and increase sales. The purpose of this paper is to provide a case-based framework to offer insights on the opportunity of recovering parts. We consider a two-stage supply chain, where independent repair shops are responsible for handling the repair process. There are two options to meet spare parts demand: repair shops may replace the part with a new one (ordered from the OEM) or they may use a part that they repaired before. While repair shops achieve a larger profit by repairing parts, the OEM would prefer the use of new parts. However, he has no control on demand which might be obtained through buyback of broken parts. Furthermore, the OEM could recover these parts on a higher level, thus reducing production/procurement of new parts. The main contribution of this paper is to elaborate the important effects of recoverable items acquisition on spare parts demand by using a simple deterministic framework thus outlining the impact of different parameters on the profitability of spare parts management.Closed-Loop Supply Chains, Spare Parts, Competition in Product Recovery, Case Study

Dynamic eco-design strategic options for electric-electronic industry

National audienceToday industries from the electric and electronic sector are facing the challenge of improving the environmental performance of the product (eco-design). Various corporate attitudes and their related policy conduct industries to launch different solutions for eco-designing their product and services. Various strategic needs for environmental improvements therefore emerge. In addition important amount of eco-design methods are available. The challenge of planning which eco-design method to be used for a specific need is thus considerably increasing over time. This research therefore aims at providing a mechanism to generate some relevant eco-design options or some sets of methods for answering to the specific corporate orientations chosen. Existing eco-design methods used in the electric-electronic sector have been carefully analyzed and various ‘interactions’ between the actions followed in those methods have been identified. From this analysis, this research provides a new network of eco-design actions allowing company to explore different solutions and roadmaps for reaching concrete eco-design requirements. The company is able to select the solutions that best follow its eco-design needs depending on its specified strategic constraints and their dynamic operational context. Meanwhile, a framework was proposed to guide the company to consider these different eco-design options within its specific context. This method has been used on a case study, which has demonstrated that its ability to efficiently support the company in reaching eco-design goals

Moving forward in reverse : a review into strategic decision making in reverse logistics

Reverse Logistics, the process of managing the backward flows of materials from a point of use to a point of recovery or proper disposal, has gained increased industry acceptance as a strategy for both competitive advantage and sustainable development. This has stimulated a growing number of researchers to investigate Strategic management issues relating to the set up and control of effective and efficient Reverse Logistics systems. This paper systematically reviews the most important works in this field, with a focus on papers that concentrate on the strategic decision making process involved in the design and operation of a Reverse Logistics process with remanufacturing. The review found that: the majority of work is primarily focused on OEM specific issues; the sectors receiving the most attention are the ones under the greatest pressure from environmental legislation; and previous research findings from Rubio et al. (2009) and Fleischmann et al. (2000) are reaffirmed that the Reverse Logistics field is growing, but characterised by mainly quantitative, mathematical models. Future research efforts should be focused on the empirical investigation of the Reverse Logistics design process for all types of remanufacturers

Modeling a Remanufacturing Reverse Logistics Planning Problem: Some Insights into Disruptive Technology Adoption

Remanufacturing is the process to restore the functionality of high-value end-of-life (EOL) products, which is considered a substantial link in reverse logistics systems for value recovery. However, due to the uncertainty of the reverse material fow, the planning of a remanufacturing reverse logistics system is complex. Furthermore, the increasing adoption of disruptive technologies in Industry 4.0/5.0, e.g., the Internet of things (IoT), smart robots, cloud-based digital twins, and additive manufacturing, has shown great potential for a smart paradigm transition of remanufacturing reverse logistics operations. In this paper, a new mixed-integer program is modeled for supporting several tactical decisions in remanufacturing reverse logistics, i.e., remanufacturing setups, production planning and inventory levels, core acquisition and transportation, and remanufacturing line balancing and utilization. The model is further extended by incorporating utilization-dependent nonlinear idle time cost constraints and stochastic takt time to accommodate diferent real-world scenarios. Through a set of numerical experiments, the infuences of diferent demand patterns and idle time constraints are revealed. The potential impacts of disruptive technology adoption in remanufacturing reverse logistics are also discussed from managerial perspectives, which may help remanufacturing companies with a smart and smooth transition in the Industry 4.0/5.0 era